TITLE:
Trustless, Permissionless, Non-Custodial Stablecoins in Decentralized Autonomous Organizations (DAO)
AUTHORS:
Alessio Castello, Gregory Gadzinski
KEYWORDS:
Blockchain, Cryptocurrencies, Stablecoins, Decentralized Autonomous Organizations
JOURNAL NAME:
Theoretical Economics Letters,
Vol.12 No.6,
November
11,
2022
ABSTRACT: The benefits offered by cryptocurrencies are a great many: transaction
cost and speed, security and transparency, to name a few. Yet, there is also a
major drawback represented by their extremely high volatility. Stablecoins
offer an ideal solution since they preserve all the advantages of
blockchain-based currencies, while reducing considerably the volatility issue.
Currently, stablecoins are almost exclusively pegged to the US Dollar and
secured by non-crypto assets held in account at custodial institutions. In
this article, we present the design of a decentralized organization aimed at
issuing stablecoins backed by crypto-assets stored on-chain and pegged to
assets different from fiat money. Our model offers several advantages, in
particular, it allows the issuance of stablecoins in a trustless, permission-less
and non-custodial environment.